The widely expected announcement of a China-Australia Free Trade Agreement (ChAFTA) included several commitments on immigration. The proposed changes to Australian immigration for Chinese nationals and businesses have been met with both satisfaction and expressions of concern about the impact on local employment conditions.
Business has welcomed the potential for increased freedom of movement and some business people have encouraged the Australian government to go further by reducing current restrictions on working visas. At the same time unions have stated that the moves threaten local employment and employment conditions. The opposition Labor party has indicated that it will await release of the legislation to make a decision on whether to support the changes.
Proposed movement commitments
From an Australian perspective the announced ChAFTA reforms include commitments by the Australian government to allow:
- Chinese intra-corporate transferees and independent executives for up to 4 years;
- Chinese contractual service suppliers to enter for four years including up to a combined total of 1,800 Chinese chefs, WuShu coaches, Traditional Medicine Practitioners, and Mandarin language tutors subject to standard immigration requirements;
- Installers and maintainers for up to 3 months; and
- Business Visitors for up to 90 days or 6 months for service sellers.
Dependents and spouses will be eligible to be granted visas where visa periods are longer than one year. Both Australia and China have committed to processing applications in a timely manner and increased cooperation in skills recognition and licensing.
Investment Facilitation Arrangements
The most controversial of the reforms, the Investment Facilitation Arrangements (IFA), will enable Chinese owned companies undertaking infrastructure projects valued at more than $150 million to negotiate enterprise specific concessions. The government has stated that the proposal would allow case-by-case arrangements similar in nature to the former Enterprise Migration Agreements.
The announcement from the Department of Foreign Affairs and Trade (‘DFAT’) states that the IFAs will operate within the existing 457 framework and will not impact on Australian employment conditions. IFAs will be open to all nationalities and will be non-discriminatory.
Work and Holiday Arrangement
The ChAFTA will also include extension of the Work and Holiday Arrangement to Chinese nationals. The programme will allow for up to 5,000 visas each year.
Likely impact of proposals
The proposed movement commitments are unlikely to have a major impact on the existing structure of the Australian migration programme. Although a full analysis cannot occur until the draft legislation is released the proposals as announced by DFAT statement appear to mirror existing arrangements under the 457 programme and 400 Short Stay Work visas.
The IFAs appear to be the greatest shift from the existing regulatory system. IFAs were framed in the government’s statements as a concession for Australian registered Chinese companies operating along the lines of the former Enterprise Migration Agreements. However the content of the statement suggests the agreements are more in line with the existing Labour Agreement system but targeted at Chinese businesses. Labour Agreements allow businesses to apply for an agreement to sponsor 457 visa holders with concessions on English language ability, occupations not available on the 457 list, and remuneration below the 457 requirements. Further detail will be required before to confirm whether IFAs are simply a re-branding of existing Labour Agreements or will create separate class of agreement with distinct conditions. The government’s statements to date suggest the former proposition is more likely.
Given that unions have continued to express concerns about the 457 visa programme in general, and Labour Market Testing in particular, it is unsurprising that they would oppose the IFA announcement. The claim that IFAs will undercut local employment and conditions is serious but lacking in substance. Available information suggests IFAs will operate like existing Labour Agreements and it is highly unlikely the government would attempt to remove the requirement for visa holders to receive equivalent terms and conditions to Australians. This requirement is one of the fundamental tenants of the 457 system and attempts to remove it would likely be the government’s opponents in the Senate.
Finally, the Work and Holiday Visa announcement is likely to have little impact on the overall economy. The numbers are small in the context of the overall programme – in the 2013-2014 year approximately 240,000 Working Holiday and Work and Holiday visa were granted.
The Work and Holiday visa is a ‘second tier’ programme with higher requirements than the Working Holiday visa. It is likely that China was added to the programme to strengthen bilateral ties and bring it into line with other countries in the region such as Malaysia, Indonesia and Thailand. Regional countries eligible for the Working Holiday visa include Taiwan, Japan and Korea.
Overall the proposed immigration reforms appear to mirror existing arrangements. Final details on the IFA will be required to confirm whether these agreements will result in any changes of substance to existing immigration arrangements.